-- Posted 2 October, 2008 | Digg This Article |

The Metals:

Gold fell nearly 2% in Asia and London and fell even further in New York to as low as $828.95 by late morning before it rebounded $13.60 from that low in the last couple of hours of trade, but it still ended with a loss of 4.5%.  Silver followed a similar pattern on its typical accelerated scale and ended with a loss of 12%.

Euro gold fell roughly €19 to about €609, platinum lost $60 to $971, and copper fell nearly 15 cents to about $2.65.

Gold and silver equities steadily fell for most of the day and ended with over 15% losses.

The Economy:

Tomorrow at 8:30AM EST brings September’s jobs data.  Nonfarm Payrolls are expected at -105,000, the Unemployment Rate is expected at 6.1%, Hourly Earnings are expected at 0.3%, and the Average Workweek is expected at 33.7.  At 10AM is the ISM Services report for September expected at 50.0.

The Markets:

Charts Courtesy of http://finance.yahoo.com/

Oil fell on concerns over falling world demand while the dollar rose markedly versus the euro as “the European Central bank held rates steady and implied its door was open to easing.”  Not only was Trichet tame on inflation, but he also voiced concerns over slowing economic growth and that certainly lowered the outlook for not only weak European growth relative to US growth, but also for global economic strength overall.

Treasuries rose as the Dow, Nasdaq, and S&P fell on bailout uncertainty.  The senate passed the plan last night, but the bill still needs to pass the House tomorrow after previously failing earlier in the week and many are uncertain that the bill will help solve the problem even if it is passed.  Much worse than expected economic data was not to encouraging to bulls either.

Among the big names making news in the market today were the SEC, Marriott, GE, and Constellation Brands.

The Commentary:

“Dear CIGAs,

I have no doubt that $1650 will come. My concern is not that it will not happen, but that I am much too conservative in my long-term price objective since 2000.

If major banks can be torn apart how can we have faith in the small local institutions that hold most of your ready cash?

When I said “This is IT,” it is not something that I take lightly. Never in 49 years in finance have I seen a set of circumstances so challenging to the man in the street.

What I am getting at is a simple question. Are you prepared? You have heard us talk repeatedly on removing financial intermediaries between you and your assets, but the time has come for us to recommend going one step further:

Hold enough cash at your household to last you a month or two. It may be largely unnecessary for the majority, but what do you have to lose? If your bank should fail this will save you a lot of grief in the short term. If they do not, you still have all your cash that can easily be deposited back into your account.

…

Unless the LIBOR rate drops sharply we are facing a planetary financial crisis next week.

For God's sake protect yourself.

Gold and gold related items will be the only true storehouses of wealth. The bailout bill is powerless to reverse what is now happening.

This is a modern day Weimar happening right before our eyes.

Regards,”- Jim Sinclair, JSMineset.com

“December Gold closed down 43 at 844.3. This was 9.3 up from the low and 28.5 off the high.

December Silver finished down 1.65 at 11.12, 1.13 off the high and 0.04 up from the low.

While the gold bugs can still hold out hope that the US House will stumble in their effort to pass a bailout package and the gold bulls can also hope that the financial troubles continue to surface in Europe, the slide in prices Thursday highlights at least some tempering of anxiety in the marketplace. However, the loss of some flight to quality concerns wasn't the only thing driving down gold prices on Thursday as gold saw pressure from a number of outside market forces. In fact, with a sharp slide in oil prices, massive weakness in the US equity market and a soaring Dollar, the outside market forces were really weighing on gold.

The silver market saw a massive broad based washout on Thursday as the market was hit with what appeared to be financial and physical commodity related selling themes. With massive declines in a host of physical commodity markets and the US factory orders report showing recessionary type data, it wasn't all that surprising to see silver suffer historical selling pressure. In the end the market seemed to be suggesting that without a total financial crisis, many longs were unwilling to hold onto silver.”- The Hightower Report, Futures Analysis and Forecasting

GATA Posts:

Greece joins stampede for Europe-wide bank bailout

Fed considers rate cut as recession fears mount

Momentum grows to ease mark-to-market accounting rules

Former Treasury secretary calls bailout plan 'crazy'

Comex prices aren't real, so root for them to go to zero

Ambrose Evans-Pritchard: Europe's banks more leveraged than U.S. banks

James Turk: Wealth destruction now is inflationary

The Statistics:

As of close of business: 10/01/2008

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

 Note: Change in Total Tonnes from yesterday’s data: The LSE added 0.34 tonnes.

COMEX Gold Trust (IAU)

 Note: No change in Total Tonnes from yesterday’s data.

Silver Trust (SLV)

 Note: No change in Total Tonnes from yesterday’s data.

The Stocks:

Freeport’s (FCX) worker strike, NovaGold’s (NG) warrants exercised, Paramount’s (PZG) closed deal with Tara Gold Resources, Harmony’s (HMY) mine death, Gold Fields’ (GFI) agreement with Bateman Engineering N.V. to sell its BIOX Technology Business, International Minerals’ (IMZ.TO) cash costs, and Silver Dragon’s (SDRG.OB) feasibility study were among the big stories in the gold and silver mining industry making headlines today.

No “Winners” today.

LOSERS

Winners & Losers tracks NYSE and AMEX listed gold and silver mining stocks that trade over $1.

All of today's gold and silver stock news:

Platinex has encouraging Phase 1 sampling results and files NI 43-101 qualifying report on Shiningtree gold property - More
- October 02, 2008 | Item | E-mail

Fischer-Watt Acquiring Significant U.S. Uranium Assets - More
- October 02, 2008 | Item | E-mail

Metals Creek Resources Corp. Announces Initiation of Airborne Radiometric and Vtem Survey on Gabbro Lake Project, Western Labrador - More
- October 02, 2008 | Item | E-mail

Aurelio Announces Agreement to Sell Hill Copper-Zinc Project & 3% NSR in Gavilanes Gold Project to an Investment Company - More
- October 02, 2008 | Item | E-mail

NovaGold Investors Exercise Warrants for Proceeds of $16.2 Million - "NovaGold Resources Inc. (Toronto:NG.TO - News)(NG - News) today announced that on October 1, 2008 investors exercised an aggregate of 2,311,350 warrants to purchase approximately $16.2 million in NovaGold shares at C$7.00 per common share. The proceeds from these warrants which expired on October 1, 2008 will be used by NovaGold for general corporate purposes." More
- October 02, 2008 | Item | E-mail

Katanga Mining Appoints Interim CEO and COO - More
- October 02, 2008 | Item | E-mail

CMC Metals Ltd. - Silver Hart Mine Application Deemed Complete - More
- October 02, 2008 | Item | E-mail

Some miners see silver lining to financial turmoil - "Miners more used to finding riches underground say they may have struck an unexpected seam in the U.S. financial crisis: cheaper fuel and equipment.

The deepening crisis is cutting credit to everyone, forcing smaller and mid-size producers to shelve new or marginal projects and freeing up key materials for larger companies that have the cash liquidity to pay for them." More
- October 02, 2008 | Item | E-mail

AMF Declares Conformity of IAMGOLD's Cash Bid for Euro Ressources at EUR 1.20 Per Share - "The opening of the offer is an important step towards the successful completion of the acquisition which will benefit both IAMGOLD and the shareholders of Euro. The offer provides compelling value and liquidity for Euro shareholders. Once completed, this acquisition will, on consolidation, eliminate the royalty obligation on our flagship asset, the Rosebel mine, which reduces cash costs at the mine by approximately US$50 per oz. The completion of the acquisition will be a significant achievement in reaching our long-term objective of reducing our cash cost below the industry average." More
- October 02, 2008 | Item | E-mail